PLP Support Continued Infrastructure Investment
Following Bermuda’s downgrade by Fitch, the Progressive Labour Party said they feel it is “important that the Bermuda Government continue to press ahead with its investments in infrastructure which will bring jobs, income and new opportunities to Bermudians.”
Fitch Ratings released a statement today [June 26] saying they have downgraded Bermuda to ‘AA’ from ‘AA+’, with the statement saying the downgrade “reflects its weak macroeconomic performance relative to peers, deteriorating fiscal and government debt ratios and lack of a credible fiscal consolidation strategy.”
The practical impact this could have on Bermuda is a potential interest rate increase on money the Government borrows. The Government is presently meeting with potential lenders, and in the 2012 budget [PDF] the Premier said the deficit would be $172 million, which Government proposed to finance “in part by the issue of a local bond at a competitive rate of interest.”
The full statement from the PLP said, “While today’s ratings adjustment is not positive, it is important to remember that Bermuda still enjoys the 3rd highest [out of 20] ratings awarded by Fitch.
“Today’s adjustment sees Bermuda return to an AA rating, which Bermuda held from 1994 to 2006. In 2006, under the PLP leadership Fitch adjusted Bermuda’s rating upwards to AA+, today’s adjustment returns us to pre-2006 levels.
“The PLP feels it important that the Bermuda Government continue press ahead with its investments in infrastructure which will bring jobs, income and new opportunities to Bermudians.
“Bermuda’s debt represents an investment in schools, housing, docks, buses and ferries, buildings and infrastructure that make life better for Bermudians now and in the future.
“Further, the PLP supports the government’s stance to freeze spending at current levels. Further spending cuts, as advocated by the OBA, will only serve to do more damage to our economy during these tough times, putting more strain on Bermudian families,” concluded the statement from the PLP.
At least one party gets it.
I’d prefer a downgrade to 2006 levels than 1000 more people unemployed trying to please some people in New York.
More i hear, more i’m convinced OBA would make our economy worse.
Idiot
1000 will still be laid off, just not on Bermuda’s terms. The debt holders will demand it in 2 to 3 years time before lending any more money. We are no longer in control of our own fate. Our debt has enslaved us to the US/European/Asian investor. And it’s our own fault. No one else’s.
Mark these words… The cost of this debt will ultimately be thousands of unemployed Bermudians. The only way this can be avoided is if we fund a new source of foreign revenue, and FAST!
The more I read your posts I know the PLP and those that blog in undying support are just PR people posting nonsense hoping it will stick. Two options here cut civil servants now or later. If done now the Government could start building funds to help service the debt sooner, our interest rates could drop, meaning government could start actually paying for some of the stuff in the budget now. If done later we could see a longer road to recovery. This is just my opinion as I do not see constantly digging deeper into the whole to pay salaries as sustainable. I see an argument for gradual weaning off but it is clear we cannot keep burrowing money of this magnitude to cover basic expenses. That cannot be the option it will sink this country. Perhaps it was the PLP’s plan to drop the standard of living (“reset the dial”). Did they plan for it to drop this low?
LOL
I’ll give you the benifit of the doubt here. Please explan why you think the PLP gets it and how thier plan gets Bermuda back to profitablity for Mr. and Mrs. Average Bermudian and how everyone below the average even start to catch up?
LOL
What infastructure?
The new Causeway? Sewage treatment plants? Composting at Pembroke Dump? Ecological restoration of Pembroke Marsh/Dump into a park? Hamilton Waterfront Development? Fixing up back-of-town?
I get the new hospital, but what other infrastructure is due for an upgrade?
I just wish there was more clarity about what this oft talked about new infrastructure they plan on developing which will help the country out in amenity value, as well as provide jobs and so on.
They are like deer in the headlights. They have no idea what to do
The new sidewalks with pretty little diamonds in the middle are crucial to ending the recession! … Ok, so there are a few more jobs for the Ministry of Public Works… What about all other Bermudians that have degrees and don’t want to lay new sidewalks?
Exactly. What infastructure.
The roads are in the worst condition they have ever been and to think we have more civil servants than before, the roads should be looking good.
jobs, income, and new opportunities? You’ve got exactly 6 months to produce the goods behind your chatter….January is comming and with 2b of debt thanks to Bad Boi Brown, you better do something quick to make me feel a whole lot better about voting for you
Can we continue spending with this attitude? Can we afford increased interest payments – $300 million+? Is the OBA going to put our economy in danger?
@ J. Starling: I have to ask the same question – “What infrastructure?” The roads are bad, and actually dangerous for bike riders with their lengthwise uneven surfaces where slippage can cause a serious imbalance. The Causeway has been ‘temporary’ for years, etc., etc. Yet there are millions planned for building more prefab apartments (which have to be imported along with the experts to construct them – all money going out of the country) when folks are having difficulty renting the ones that exist (and I’m not even talking about that eyesore on South Shore).
I don’t mind being wrong. I’ll admit it in a heartbeat if you can show me conclusively that I AM wrong. In fact, I wish I was wrong, that things aren’t as bad as they appear. I am trying to extrapolate who benefits if we go bankrupt, since we appear to be heading that way PDQ.
Pastor Syl, I love your posts….The temporary bridge scares me everytime I cross it….and our roads are deplorable !! PLEASE be a candidate for the OBA.
PLP infrastructure investment = putting new tires on buses weeks after they are needed. What a joke…
Please name the schools, the buses & ferries, the docks, the housing (BLDC, BHC & WEDCO are not Govt.), the buildings, etc. that the Govt is investing in in 2012?
Well, there was the new investment in lighting at Global House. Twice if I’m not mistaken.
There was a wall the W&E rebuilt down by Shelly Bay after the hurricane. We hired a couple of consultants at Wedco to tell the President & the Board how to run Wedco.
We haven’t actually paid anything for the hospital yet so can’t count that out of the $2 billion debt. But we did buy new tires for 18 buses, so that’s something.
We might want to invest in a few more spare parts for the rest of the buses. And the ferries.
Just have to find someone who wants to loan us another $300 million to get through the end of the year.
The docks at Dockyard, the court/police building, housing for Bermudians, also social programs. Come on Starling.
The docks at Dockyard? Oh, you mean the one that we spent, what was it, $65 million on, which it was budgeted at $30 million? The one that fell apart after two years with the first strong hurricane due to bad craftsmanship?
Oh, that dock!
And the social programs, hmmm…oh, the free Bermuda College tuition? What, they cut that back after two years? And the free daycare? What, we don’t have that anymore either?
Yeah, I guess you’re right…
“Press ahead with investments in infrastructure” – Infrastructure such as? Housing? What about the causeway.. what about the Government owned buildings that are dilapadated and can be repaired to be put to use?
Where is PLP’s plan with regards to our debt? How will they get more money if revenue is shrinking?
IMO I think the PLP has done alot of positive infrastructure.. i.e lamb foggo clinic, docs, court bldg etc.. but seriously.. cut down on spending, keep locals employed… but you will end up laying off many civil servants in the forseeable future.
CHoose your poison wisely IMO.
But I think you have too many fools in high places in govt.. someone needs to do an internal audit of the civil service
I wasn’t referring to past investments, I was referring to the statement ‘we will continue to invest’, the future tense. I just would like some greater clarity on what the future priority projects would be.
By ‘infrastructure’, they mean the interest on what they already borrowed.
We’re on the same path as Greece.
When unemployment is 25% I guess it will finally sink in that there’s no more borrowing possible.
The Government door openers and closers needs to go
Gotta keep the money trough going for all the ten percenters…
“Infrastructure”? Really? They’re having to borrow to cover day-to-day expenses, let alone “Infrastructure”. Goodness me.
What about the Lighthouse????
Since the PLP claim they are investing in infrastructure, could they PLEASE re-pave our dangerous roads and fix the MANY street lights that are STILL out all around the island. Let’s start with the basics guys. Roads are the basics of infrastructure.
Don’t worry, an election is coming. That means the $180m will be spent on road paving, making sure street lights are working, making things look pretty. Just temporarily until the election, of course. Then we go back to everything falling to pieces, buses not running because they have no tyres, ferries rusting, schools not being painted.
The majority of government spending that has increased our debt level have gone into the pockets of Bermudian Businesses.
and when do we start paying for the Hospital?
At least most here are clear the infrastructure talk is an attempt to distract from the use of these monies in the operating account….not any capital account. Kicking the can down the road to pay and pay dearly at a future date.
Question for the PLP: what would we NOT have if we did not take on this debt?